Government Finance Statistics, Education, Australia methodology

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Reference period
2019-20 financial year

Explanatory notes

This release contains statistics on expenditure on education by the general government sector. They are presented on an accrual accounting basis and are taken from the system of Government Finance Statistics (GFS), which is designed to provide statistical information on public sector entities classified in a uniform and systematic way.

GFS enables policy makers and users to analyse the financial operations and financial position of the public sector by the level of government, institutional sector or set of transactions. The system of GFS is based on international standards set out in the System of National Accounts, 2008 (2008 SNA) and the International Monetary Fund's (IMF) Government Finance Statistics Manual (GFSM). The IMF published a revised Government Finance Statistics Manual (GFSM 2014), and the ABS GFS manual was updated to reflect the new international standards. These changes are presented in the Australian System of Government Finance Statistics: Concepts, Sources and Methods, 2015 (AGFS15) and have been implemented for data reported for periods from 1 July 2017 onwards.

GFS education statistics include information on operating expenses, net acquisition of non–financial assets, gross fixed capital formation, and sales of goods and services relating to education (i.e. student fees and charges made by governments and educational institutions in exchange for the provision of educational services).

Summary information relating to private expenditure on education is also included and has been sourced from the Australian National Accounts. Paragraphs 14–19 of these explanatory notes provide an explanation of the private expenditure items included in this release.


General government education operating expenses include some expenses intended to facilitate education but which are not spent on educational services and facilities. Examples of such expenses are payments termed current monetary transfers to households and living allowances paid to students which are used to finance expenditure on food, clothing, transport, rent, etc.


The main GFS classifications used to produce these data are:

  • Economic Type Framework for GFS (ETF)
    This is the main classification of stocks and flows. Stocks refer to the holdings of assets and liabilities at a point in time, ideally valued at current market prices. Flows are economic events and other occurrences, recorded in the period in which they occur, that cause changes in the value of stocks through the creation, transformation, exchange, transfer or extinction of value. Thus, the stock of assets and liabilities recorded at the beginning of a period changes as a result of flows during the period, moving to new levels at the end of the period.

    The Economic Type Framework resembles a set of financial statements, with sections for an operating statement, a cash flow statement and a balance sheet. In addition, there are sections to cater for the reconciliation of accounting net operating result measures with cash flows from operating activities and to capture items like assets acquired under finance leases, intra–unit transfers, revaluations and other changes in the volume of assets.
  • Classification of the Functions of Government - Australia (COFOG-A)
    This classification is used to group operating expenses and expenditure by purpose (education, health, etc.) with similar functions to facilitate the study of the broad function of public sector spending and the effectiveness of this spending in meeting government policy objectives.

General government transactions included in the calculation of data presented in this release relate to those transactions which have been classified to 'COFOG-A 09 – Education'. There are some issues, however, relating to the structure and application of the COFOG-A that should be considered when interpreting the data. Nurse education carried out in hospitals is included in 'COFOG-A 07 – Health' because of the difficulty in separately identifying these expenditures in the accounts of hospitals.

In addition, differences in institutional structure and accounting practices make it difficult to implement the COFOG-A in a way which leads to fully comparable statistics between the states. For example, in some states expenditure on the education of disabled children (which should be classified to special education) is included under primary and secondary education because data are not separately available. These differences need to be taken into account when comparing the statistics between states and over time.

Detailed information on the concepts, sources and methods used in compiling GFS can be found in Australian System of Government Finance Statistics: Concepts, Sources and Methods (AGFS15).

Private expenditure on education

Expenditure on education by the private sector (as recorded in the National Accounts) consists of household final consumption expenditure on education services and gross fixed capital formation mainly by private educational institutions.

Household final consumption expenditure on education services is estimated as:

  • fees (other than boarding fees) paid by persons to government schools (including technical and agricultural colleges), independent schools, business colleges, universities etc
  • gifts paid to independent schools, business colleges, universities etc
  • payments to tertiary institutions made under the Higher Education Loan Program (HELP) introduced on 1 July 2005, and under the previous Higher Education Contribution Scheme (HECS) as they are classified as charges for the provision of services by the tertiary institution
  • current expenditure of non–profit educational institutions, net of fees and other current receipts. Current expenditure excludes interest and consumption of fixed capital and is financed by fees paid by households and current grants from general government.

Expenditure on such items as school books, uniforms, etc. and expenditure by parents’ associations on school equipment are not included in household final consumption expenditure on education, but are treated in the Australian System of National Accounts (ASNA) as household final consumption expenditure on other goods and services (such as clothing, books, etc.). Fares paid by students travelling to and from educational institutions are not counted as part of household final consumption expenditure on education, but are included in transport services in ASNA.

Private gross fixed capital formation in the field of education is estimated in ASNA from statistics of the value of work done on new building and major additions to buildings of private educational institutions.

It is important to note that estimates of government expenditure on education and of private expenditure on education cannot simply be aggregated to derive an estimate of total expenditure on education. This would result in double counting of some expenditures as transfers between governments and private education institutions would not be eliminated.

The current price estimate of GDP is used to calculate expenditure as a percentage of GDP in Table 19. Current price GDP is obtained by reflating the average chain volume estimate, derived from the three independent approaches, by the implicit price deflator derived from the expenditure–based estimates. GDP is as published in Table 36, Expenditure on GDP, Current Prices in the December quarter issue in the relevant financial year of Australian National Accounts: National Income, Expenditure and Product (formerly known as cat. no. 5206.0).


GFS data are revised on an annual basis. For this reason differences can occur between equivalent aggregates published in earlier years.

​​​​​​​Related publications

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